3 Hour Dave Ramsey Podcast – Is It Best To E-File My Taxes?

Is e-filing a better way to file your taxes? 

Americans and the IRS may not agree about everything, but they are mostly on precisely the exact same page in regards to e-filing individual income tax returns.

The majority of individual income tax returns submitted to the IRS are e-filed.  E-filing is popular because it’s a win-win for taxpayers and the IRS.

And in return, you could find any refund you are owed faster, particularly in the event that you have it directly deposited to your bank accounts.

However, what about safety?  And can electronic filing actually give you access to all the forms you might need in case you’ve got a intricate tax situation?  Are there situations when you can not e-file?  Let us look at the benefits of e-filing, and if it may be the best filing option for your requirements.

If you are Considering e-filing, a Few of the advantages include:

  1. Quick affirmation your forms are received: The IRS will affirm a tax filing has been received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived . 

    Timely refunds: When you publish a paper filing, it can take six to eight weeks to receive a tax refund.  With e-filing, you’ll receive your money in 3 weeks or less.  Choosing direct deposit can also speed up the refund procedure.

  2. Reduced likelihood of mistakes: According to the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% speed of errors on paper filings.  The IRS also provides more info on problems discovered on e-filed yields compared with paper yields.

  3. Simple payment procedure: If you owe the IRS money, it is simpler to pay at your advantage when you e-file.  It’s possible to submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline.  You also have the option to pay your balance by making use of the IRS Immediate pay service from the checking account or savings account, filing a credit card through a payment processor for a fee, or paying by check or money order. 

  4. Digital storage of taxation data: Submitting returns electronically implies there is an electronic copy of your tax records.  So if something happens to your paperwork, you’ll have a digital backup.

The fantastic news: Most taxpayers do opt to e-file and find those advantages — and the process of doing so is easy.

    1. Use IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is over $72,000 and you’re comfortable doing your taxes without any assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide basic advice.  You can only do your federal return with these kinds. 
    3. Use an internet tax preparation service or tax software: Tax prep software and online filing services are options.  These choices are a simple way to complete and e-file your own forms.  Some software suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your life and financing to guide you through the completion of your types.  
    4. Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on earnings, and a few services cater to particular demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older. 
    5. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a database of authorized providers, but be aware this option is very likely to be the most costly one. 

Employing online tax prep software is far and away the preferred approach of most taxpayers.  Actually, the IRS says it anticipated over four in five tax returns to be filed through tax return prep program.

Is e-filing really stable?

While e-filing is suitable, you could worry about safety — particularly with all these data breaches.  But experts agree this is not an issue that should dissuade you from e-filing.

“In fact, it may be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your data in the mail.”

Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has put security measures in place to keep your information safe.  “Trainers normally use IRS specific APIs that need ab sessions,” Chow says.  “All of this is routed over TLS encrypted links .”

It’s very important to use a trusted service that will assist you record your taxes.  Chow advises not to e-file on a computer or utilize an online connection that isn’t confidential.

Bottom line

For many taxpayers, it is sensible to e-file a yield since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options.  Just make certain that you use tax planning software from a trusted source, so you may ensure the information you provide to transmit to the IRS will be kept secure.